[Kabar-indonesia] 7 RI Commodity Reports: Coffee; Palm Oil/Fast Food Chains; Rubber

[JoyoNews at aol.com]

7 Reports:

- Indonesia Coffee - Tight supply
  slows trade, Mandheling firm
- Indonesia's rubber output seen rising
  5.7 percent in 2006: industry executive
- Indonesia's rubber exports may surpass
  4 bln usd this year - report
- Asia Rubber-TOCOM slides, physical
  higher
- Interview-Global H1 rubber demand falls,
  recovery seen-IRSG
- Indonesian palm oil down on thin
  demand, Malaysia
- Interview-Malaysian firm sees palm
  sales to fast-food chains

Indonesia Coffee - Tight supply slows trade, Mandheling firm

JAKARTA, October 4 (Reuters) - Tight coffee bean supplies from
plantations in Indonesia's main growing area of Sumatra island have
slowed trade in the world's third-largest coffee producer.

But trade in Mandheling arabica is likely to be strong as the main
harvest season gets under way at the end of the month, traders said on
Wednesday.

Daily arrival of robusta coffee beans from plantations to the main
port of Panjang in Lampung province, in the southern part of Sumatra
island have halved to 150 tonnes from around 300 tonnes last month.

"There were not too many stocks left in Lampung because supply from
the plantation has been very tight as farmers don't have too many
beans to offer anymore," a trader in Bandar Lampung, provincial
capital of Lampung, said.

"Nowadays only big exporters still have stocks and it's only to cover
their contracts."

Some exporters offered Lampung beans firmly at a premium over London
coffee futures, which settled at $1,511 a tonne <LKDX6> on Tuesday,
while others offered at a discount of $50-70 a tonne, traders said.

Local prices of robusta -- widely use for instant coffee -- collected
from farmers and middlemen, rose to between 13,700 and 13,900 rupiah
($1.49-$1.51) a kg from 12,900 and 13,000 rupiah last week.

The export price eased to between $1,470-1,480 a tonne, free-on-board
at Lampung port. <COFFEE/ASIA1>

"Farmers have been struggling to sell coffee to meet their needs
during Ramadan and Eid al-Fitr festival. But most of them were only
able to watch and do nothing as there are no beans left to offer,"
another Lampung-based trader said.

Coffee bean exports from Sumatra island in the first eight months of
the year fell 22.68 percent from a year earlier to 168,459.6 tonnes
due to lower output.

August exports alone fell 17.67 percent to 34,113 tonnes from a year ago.

Robusta constitutes 85 percent of Indonesia's coffee output, while the
rest is aromatic and high-value arabica. Lampung accounts for
three-quarters of Indonesia's coffee bean output.

Traders said they expected Mandheling arabica supplies to rise
starting next month as the main harvest season kicks off in North
Sumatra.

"It's been very quiet in Medan with thin stocks left in the market.
Some buyers have shown interest to meet the winter consumption, but
there's nothing much we can do," said a trader in North Sumatra's
provincial capital Medan.

"Fresh supplies are likely to start entering the market next month,"
another trader in Medan said. "Trading will be more active once the
harvest is in full swing in December and January."

Arabica Mandheling was offered at $3,100 a tonne, free-on-board at
Belawan port in North Sumatra.

The main harvest season of Mandheling arabica traditionally runs from
the end of October to March.

---------------------------------------------------------------

Indonesia's rubber output seen rising 5.7 percent in 2006: industry executive

JAKARTA, Indonesia, October 4 (AFP) -- Indonesia's natural rubber
output is expected to reach 2.4 million tonnes, up 5.7 percent from
2005 amid rising prices which have prompted more farmers to return to
the crop, an industry executive said Wednesday.

Suharto, executive director of the Indonesian Rubber Firms'
Association, said that boosted production, compared to 2005's 2.27
million tonnes, was mostly due to rising world prices and demand for
the commodity.

Rubber farmers had turned to other more profitable commodities when
natural rubber prices dropped in 1998 until 2001 but improving prices
have seen them return to rubber, he said.

"We can expect our annual output to continue to rise as prices
improve," he said, noting that demand was rising in China and India,
both major markets for the 90 percent of Indonesia's production which
is exported.

Another executive from the organisation, Syarbaini Zain, was quoted by
Bisnis Indonesia daily as saying that he expected the value of exports
of rubber and rubber-based products to reach 4 billion dollars in
2006, compared to 3.5 billion dollars last year.

The Central Bureau of Statistics has said that rubber and rubber-based
products have been the biggest contributor to growth in
non-oil-and-gas exports growth in Indonesia so far this year.

In the first eight months, the value of exports of rubber and
rubber-based products surged to 3.75 billion dollars, up from 2.17
billion dollars in the corresponding period last year.

Thailand, Indonesia and Malaysia account for about 80 percent of the
world's natural rubber output.

----------------------------------------------------------------

Indonesia's rubber exports may surpass 4 bln usd this year - report

JAKARTA, October 4 (XFN-ASIA) - The value of exports of rubber and
rubber-based products is forecast to exceed 4 bln usd this year,
compared to 3.5 bln usd last year, Bisnis Indonesia reported.

The newspaper quoted Syarbaini Zain, an executive secretary of the
North Sumatran branch of the rubber producers association, GAPKINDO,
as saying demand in China and India was the main reason for the rise.

The Central Bureau of Statistics has said that rubber and rubber-based
products have been the biggest contributor to growth in
non-oil-and-gas exports growth so far this year.

In the first eight months, the value of exports of rubber and
rubber-based products surged to 3.75 bln usd from 2.17 bln usd in the
corresponding period of last year.

--------------------------------------------------------

Interview-Global H1 rubber demand falls, recovery seen-IRSG

By Lewa Pardomuan

SINGAPORE, October 4 (Reuters) - Global demand for natural rubber fell
nearly 2 percent to 4.48 million tonnes in the first half of 2006 from
a year ago but China's strong appetite should offer support, a senior
industry official said on Wednesday.

"As far as official imports are concerned, Chinese imports were quite
weak in the first quarter...growth was in single digits," said Darren
Cooper, senior statistician with the International Rubber Study Group.

"But the signs are that imports have recovered strongly in the second
quarter and into the third quarter, and that would naturally provide
some kind of boost to the global market in terms of growth," he told
Reuters from London.

China, the world's main rubber buyer, was expected to consume 3.8
million tonnes of natural and synthetic rubber in 2006 from 3.6
million in 2005, according to the China Rubber Industry Association.

The IRSG said global production rose 2.9 percent to 4.43 million
tonnes from January to June compared with 4.30 million tonnes at the
same period in 2005.

Exports rose 3.4 percent to 3.27 million tonnes in the first half of
this year, aided by increased shipments from Malaysia, Indonesia and
Vietnam.

Thailand, Indonesia and Malaysia account for around 75 percent of
global production.

"Indonesian and Malaysian exporters have benefited from the continuous
shift away from RSS to TSR imports on the part of major consumers,
particularly China," Cooper said.

"The shift is marked with official statistics showing that TSR takes a
70 percent share of all imports of natural rubber into China," Cooper
said, referring to Technically Specified Rubber grade.

The IRSG has said China used 4.6 million tonnes of natural and
synthetic rubber in 2005, followed by the United States with 3.1
million tonnes and Japan with about 2 million tonnes.

"The major change in our natural rubber numbers was due to a revision
to Chinese natural rubber numbers due to Vietnamese cross-border
shipments, which are not picked up China General Administration for
Customs," said Cooper.

"This trade which is not picked up by customs data serves merely to
make the Chinese market larger than official data might suggest," he
said.

Chinese customs data showed China imported 1.02 million tonnes of
natural rubber in January to August this year, an increase of 19.7
percent from a year ago.

World rubber prices have risen steadily in the last five years and the
main producers are struggling to increase supply to meet rising
demand, especially from China, which consumed 21 percent of global
rubber output last year.

The price of natural rubber has risen more than 300 percent since 2001
and the three main producers are cashing in on soaring demand, said
dealers.

"Certaintly, Chinese imports have risen very strongly and into the
third quarter, and this should aid further growth in consumption,
which we see as having recovered in recent months" said Cooper.

---------------------------------------------------------

Asia Rubber-TOCOM slides, physical higher

By Vissuta Pothong

BANGKOK, October 4 (Reuters) - Tokyo benchmark rubber futures fell on
Wednesday after lower crude oil prices discouraged some speculators
from taking new positions.

The Tokyo Commodity Exchange March 2007 contract <0#JRU:> fell 0.7 yen
per kg to settle at 224.3 yen ($1.90) on Wednesday, after trading in a
range of 218.0-225.2 yen.

Players largely ignored reports of heavy rains in southern Thailand
and Malaysia which could cut supply from the leading rubber producing
countries, dealers said.

"Speculators followed other commodities and not the weather. They are
not interested in fundamentals because they are not dealing in
physical rubber," a physical rubber trader based in Thailand said.

Other contracts ranged between 0.5 yen per kg lower to 1.4 yen per kg higher.

Oil fell toward $58 a barrel on Wednesday, taking losses for the week
to more than 7 percent, as forecasts of a further rise in U.S. fuel
stockpiles countered a call by OPEC's president to cut supply.

Rubber prices often benefit from high crude oil prices because
investors believe expensive oil will encourage a shift to natural
rubber from synthetic rubber, a petroleum product.

RELUCTANT EXPORTERS

Despite weakness in Japanese prices, physical prices in the largest
producing countries, Thailand, Indonesia and Malaysia, were offered
mostly higher on Wednesday.

"Producers are reluctant to offer now, they are looking at the
weather," said another Thai physical rubber trader.

Rains in Thailand and Malaysia could disrupt tapping and boost raw
material prices.

The Thai benchmark RSS3 rubber sheet for shipment in November and
December was offered on Wednesday up $0.05 at $1.85 per kg,
free-on-board, but there were no bids.

Offers for tyre-grade Standard Thai Rubber, or STR20 block, were also
up $0.05 at $1.85 and Malaysian tyre-grade SMR20 was offered at a
similar price.

Malaysia's tyre-grade SMR20 was last traded at $1.84 a kg,
free-on-board for November shipment, dealers said.

"Rain has been seen in the northern part of Malaysia and it has
affected production," said one Malaysian dealer.

In the open market on Wednesday, Thai benchmark unsmoked rubber sheet
grade 3, or USS3, the raw material for export-grade rubber, was
trading around 60 baht per kg ($1.60).

Natural field latex, the raw material for Thai 60-percent concentrated
latex, was selling at 54-55 baht per kg.

Thai 60-percent concentrated latex was offered at $1,200-1,250 per
tonne, free-on-board, in drums for December shipment. It was between
$1,100-1,200 per tonne, free-on-board, in bulk.

In Indonesia, few producers offered to sell its tyre-grade SIR20 as
the country is still observing the Ramadan holiday, the Muslim fasting
month which lasts until the end of October.

Indonesia's tyre-grade SIR20 was offered at 81 cents per lb, while
overseas buyers were bidding at 80.50 cents per lb, dealers said.

----------------------------------------------------------

Indonesian palm oil down on thin demand, Malaysia

JAKARTA, October 4 (Reuters) - Indonesian palm oil prices were lower
on Wednesday, dragged down by weak overseas demand and losses in
Malaysian crude palm oil futures, traders said.

At the state marketing centre in Jakarta, crude palm oil traded lower
at 4,112 rupiah ($0.447) per kg compared with 4,152 on Tuesday.

"Thin overseas demand, as some major buyers still have ample stocks,
has put pressure on the local prices," a Jakarta-based trader said."

In North Sumatra's Medan, crude palm oil fell to 4,128 rupiah a kg
compared with 4,183-4,185 on Tuesday.

"Malaysia fell a lot two days in a row, forcing sellers to sell cheap
on fears the downward trend will continue," said a trader in Medan,
adding that 750 tonnes of crude palm oil changed hands.

The benchmark third-month December <KPOZ6> contract on the Bursa
Malaysia Derivatives exchange fell 20 ringgit to 1,514 ringgit ($411)
a tonne after trading in a range of 1,510-1,523 ringgit.

In Jakarta, olein traded at between 4,600 and 4,625 rupiah per kg
compared with 4,625-4,700 on Tuesday.

On the exports front, crude palm oil was offered at $420 a tonne for
October, November and December shipment, free on board Belawan, while
bids were seen at $410.

----------------------------------------------------------------

Interview-Malaysian firm sees palm sales to fast-food chains

By Naveen Thukral

KUALA LUMPUR, October 4 (Reuters) - Malaysia's largest producer of
palm oil aims to boost exports of its packaged products by targeting
fast-food chains and nations that lack refining facilities, a senior
company official said on Wednesday.

The state-owned Federal Land Development Authority, or Felda, which
produces around 17 percent of Malaysia's crude palm oil, has started
selling to fast-food chain McDonald's Corp. in China and is trying to
bag a deal with competitor Burger King.

"We have sent samples to Burger King in Singapore for approval," said
Wan Mohamad Zain Wan Ismail, chief executive of Delima Oil Products
Sdn Bhd, a marketing arm of Felda, told Reuters. "We are already
supplying to McDonald's in China."

Delima sells around 240,000 tonnes a year of packaged palm products
such as cooking oil, vegetable ghee, margarine and dough fat, in both
domestic and overseas markets.

It ships to regions as far away as Turkey, Afghanistan, West Africa,
the Middle East and as close by as Cambodia, Vietnam and Indonesia.

Felda targets nations with few refining and packaging facilities of
their own for its sales of palm oil products. "Afghanistan and other
land-locked nations around it are our biggest market," Wan Mohamad
Zain said in an interview.

He said the edible oil cargo was shipped to Iran, and then went by
road to countries such as Afghanistan, Kazakhstan, Kyrgyzstan,
Tajikistan, Turkmenistan and Uzbekistan.

"Turkey is a growing market as it a hub for exports to neighbouring
nations in Europe and Asia."

Wan Mohamad Zain said sales of packaged edible oil to the Southeast
Asian region are likely to rise in the coming years, with demand
growing in Myanmar, Cambodia and Vietnam.

"Myanmar is buying edible oil in bulk form, but their market is also
growing, they will have more super markets and people will be looking
to buy more packaged products rather than in the loose form," he
added.

Delima plans to begin shipping palm oil in tins to Myanmar next year
with an initial target of 2,000 to 3,000 tonnes.

It also exports packaged palm products to biggest buyers China and
India but does not see a substantial growth in demand.

"They have their own refining and packaging industry, and there are
laws that protect the domestic industry."

Felda officials said the company was looking at entering into a joint
venture with a Dubai-based company to push up sales to Africa and the
Middle East.

Wan Mohamad Zain declined to discuss the topic until the joint venture
agreement was signed.

Felda, Malaysia's biggest palm oil company, produces around 2.5
million tonnes of crude palm oil each year and manages some 800,000
hectares of plantation land.

It has 72 crude palm oil mills, seven refineries and two packaging units.

------------------------------------------
Joyo Indonesia News Service
------------------------------------------